FCC decides to go back to square one on Block D spectrum

The FCC will once again try to auction off that region of the 700 MHz band …

The Federal Communications Commission has launched a new proceeding on how to
rescue the part of its 700MHz broadband auction that failed: the D Block of the
sale. That portion of the spectrum came with a public safety string attached—the
owner has to share the license with a nonprofit that provides national broadband
access to emergency responders. No party bid the FCC's minimal asking price
for the license. Now the agency says that it plans
to re-auction the spectrum "under revised rules."

At today's open meeting, the Commissioners voted unanimously to go back to square one. They were also candid about the difficulty of the problem. "I thank everyone who helped develop today’s item and who is willing to dedicate the next few months to contributing to the pressing and unbelievably important task we find before us," declared Michael Copps. "We’re going to need all the help we can get."

FCC Chair Kevin Martin announced that the agency will hold a full hearing on the D Block problem, which all five Commissioners will attend. And after receiving comments, the FCC will publish a proposal for public vetting.

No torpedoes please

This new proceeding comes in the aftermath of an FCC audit of the D Block failure. That review, conducted by the agency's Office of the Inspector General (OIG), concluded that the block had been loaded with too many expectations and uncertain variables. Preauction negotiations between potential bidders and the blocks' public safety administrators produced an ever growing laundry list of requirements and standards. The most prominent potential bidder, Frontline Wireless, confided fears that in the event that it could not meet all expectations, the FCC would impose a hefty default penalty on the company and eventually closed up shop before the auction began.

The FCC's Second Notice of Proposed Rulemaking is quite open-ended about the problem, going so far as to ask "whether it remains in the public interest... to retain a Public/Private Partnership between the D Block license and the Public Safety Broadband Licensee (PSBL) [the administrator of emergency services for the block]." But Commissioners on both sides of the political aisle answered that question in their public comments. "In the absence of the financial resources for public safety to build out their own network," Republican Martin explained, "I believe we should continue to try to explore ways in which we can help facilitate a tool to achieve a nationwide interoperable public safety network."

In his public statement, Democrat Copps lamented that Congress had not taken his advice and opted for a publicly funded emergency services broadband system, but insisted that the FCC had no choice but to make the D Block idea work. "This proceeding is about establishing a viable public-private partnership to enhance public safety," he warned. "It would be unfortunate if anyone was able to conclude that by simply torpedoing the partnership concept, they can move quickly to a purely commercial auction."

Among other questions that the FCC's Notice asks is how to organize talks between the license holder and the PSBL that will lead to a Network Sharing Agreement (NSA). "In particular, we seek to provide a process that will give bidders confidence that the network the D Block licensee will be required to construct will be commercially viable," the Notice says, "and provide assurance to state and local public safety entities that the resulting network will meet their needs for broadband wireless service."

The NSA, as presently structured, requires the D block license holder to pay for access to the public safety region of the region, and to vacate all commercial access to that region in the event of emergencies. The Notice also asks for comment on rules about priority access to the network during emergencies, performance requirements, network fees, and how to determine the next auction's reserve price (the last was $1.3 billion dollars).

Action from Congress?

The FCC does give itself a back door in its press release, warning that "additional actions by Congress may be necessary to support the cost and build-out of a nationwide, interoperable broadband network for America's first responders." Not uncoincidentally, Rep. Jane Harman (D-CA) has introduced legislation into the House of Representatives that she says will provide "critical funding and good government reforms essential to a successful second D block auction."

Harman's proposals include preventing the PSBL from accepting "third-party" money if the agency takes FCC grants. It also bars the entity from paying off debts with government funding and mandates "strict reporting requirements to the FC and Congress." In addition, the bill authorizes Congress to contribute $4 million to the D Block project, a sum Harman calls "a modest, interim funding stream." The figure is, in fact, well under a single percent of the D Block reserve price for which the FCC asked in the last auction.

"On 9/11, hundreds of firefighters and police officers died at the World Trade Center," Harman's release concludes, "in part because of their hopelessly impaired communications systems. Sadly, nearly seven years later, public safety agencies still struggle with the exact same problem."

Further reading

Matthew Lasar / Matt writes for Ars Technica about media/technology history, intellectual property, the FCC, or the Internet in general. He teaches United States history and politics at the University of California at Santa Cruz.